ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintSite TitleTitle ChevronIcon Twitter
Business deals

Toshiba Memory to buy Taiwan storage device maker for $165m

Chipmaker seeks greater share in solid state drives with Lite-On deal

Toshiba Memory produces flash memory chip at its Yokkaichi plant. The company wants to strengthen its operations in solid state drives that incorporate the chips. 

TOKYO -- Toshiba Memory Holding will buy the solid state drive business of Taiwan's Lite-On Technology for $165 million, the chipmaker said Friday, looking to bolster operations with an eye on a possible stock market debut.

The acquisition is expected to close by the first half of 2020. Lite-On is a key buyer of Toshiba's NAND memory chips, which it uses to build the drives. It also produces parts for servers, computers and automobiles.

Toshiba controlled 17.6% of the global market for NAND memory in 2018, but its share for solid state drives was under 10%, according to IHS Markit. The company hopes to catch up with rivals like Samsung Electronics, which enjoys a share of more than 35% in both.

The global market for solid state drives totals about $30 billion. Despite flagging demand from data center servers, the market is expected to expand over the long term with the rise of artificial intelligence and 5G connections.

Toshiba Memory was spun off from the Toshiba group in June 2018 and is controlled by a coalition that includes Bain Capital. It aims to conduct an initial public offering by the end of the fiscal year in March.

The holding company logged a net loss of 95.2 billion yen ($896 million) for the April-June quarter.

"Solid state drives face less volatility in demand than NAND," which is a commodity product, one analyst said. Stronger solid state drive operations likely will help Toshiba Memory stabilize its earnings.

Lite-On's joint solid state drive venture with China's state-run Tsinghua Unigroup will not be part of the acquisition.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends April 30th

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media